As solar energy becomes cheaper, it becomes an increasingly important source of clean energy in the energy mix. It can be competitive without subsidies and is now even cost-competitive when combined with energy storage in some application sectors. With both environmental and economic sustainability, investments into solar energy are obviously attractive. But as prices drop and technology develops, when is the right time to invest in solar? Looking at the market, it couldn’t be clearer: the time is now.
Solar energy is cheaper than its fossil fuel competition
The cost of renewable energy will continue to fall. On the other hand, the price of fossil fuels either remains constant, or increases with rising costs of raw material extraction (oil, coal, gas). That’s even before subsidies to fossil fuels, which were estimated to be a massive 5.3 trillion USD in 2015.
Additionally, Bloomberg New Energy Finance predicted that the cost per MWh electricity generated will fall by 47% for onshore wind, 71% for offshore wind and 66% for solar energy by 2040 . In the 2020s, these two technologies will be cheaper than any other electricity generator throughout most of the world.
No longer a question of good will
Investments in sustainable energy projects have long been regarded as a niche product for idealists. This has changed: now, they are seen as a key investment in financial as well as environmental terms. As reported in the Guardian, many funds lose significant value if they fail to invest in renewable energy projects. New York’s largest pension fund lost 135 million USD in value between 2014-2015, due to investments in companies that were active in the field of fossil fuels. Investments in such companies also led the top 15 funds in Australia to experience a combined value loss of 5.6 billion AUD (equivalent to 4.3 billion USD).
Looking to the future, we have to ask: is the current trend of investing into sustainable energy projects here to stay? Will it become the megatrend of the future? The panelists at Milken Institute’s global conference (Victor Chu, Taimur Hyat, Catherine Keating, Rebecca Patterson, Mike Ramsay) said yes: this will still be occupying us in 2040. It’s not surprising, then, that while investments into coal and gas are expected to drop to 664 billion and 804 billion USD respectively, over 2.5 trillion will be invested into solar energy in the next two decades.
How can I participate in this megatrend?
You don’t need to be a major investor to take advantage of the energy transition. Even private small investors can participate by providing subordinated loans to energy projects that are both environmentally and economically sustainable. These are offered on platforms such as www.ecoligo.investments, where you can select concrete projects to invest in from just 500 EUR and with a fixed interest rate. Join the megatrend, save CO2 emissions and enjoy a lucrative return now.
A project to provide an off-grid eco-resort in the Philippines is currently open for investment on the crowdinvesting platform ecoligo.investments. Capital is at risk. Visit ecoligo.investments/enervinci-qi-palawan to find out more.
ecoligo provides a fully financed solar-as-a-service solution for businesses in emerging markets. With a complete digital platform for financing and delivering solar projects, ecoligo removes the barriers that prevent such projects from being realised. Supplying these businesses with affordable electricity enables them to grow and boost the local economy. Find out more at ecoligo.com.
Photo: Antonio Garcia
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